You work for the Environmental Protection Agency – the government wants to regulate emissions of a particular pollutant and following your advice is

You work for the Environmental Protection Agency – the government wants to regulate emissions of a particular pollutant and following your advice is considering a market based approach rather than a command and control approach. It has not decided whether to regulate using taxes or tradeable permits.You estimate the marginal benefit to society of abating emissions as well as the marginal cost to firms of installing pollution reducing technology as MCA = 100 + Q/2 and MBA = 1000 – 2Q where Q = the number of tons of the pollutant.

(a)Given your estimates of the marginal cost and benefit of abatement. What would be the optimal emissions tax to set?

(b)If firms would emit 600 tons absent any controls, what would be the optimal number of emissions permits to allocate?

c)Some uncertainty exists in your calculation of the marginal cost of abatement – the cost of abatement may in fact be substantially higher. If the marginal cost of abatement is actually MCA = 200 + Q/2, what is the deadweight loss associated with using the tax from part (a) relative to the optimal tax rate.

(d)Explain whether your answer to part (c) would be different if the government used tradable permits rather than taxes? Why or why not?

(e)What are the relative political merits for using taxes or tradable permits?

Show more







Calculate Your Essay Price
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Order your essay today and save 10% with the coupon code: best10